Part A.
1. Company Analysis
Overview of Tesla’s Home Industry.
Tesla’s home market is mainly North America, and precisely Canada and the US. This is an American power train designer, developer, and manufacturer. The head of the company, Elon Musk, started it in 2003. Tesla has two primary sources of revenue, which are the design and development and auto sales. Tesla has continuously improved its position in the market and ultimately becoming a market leader in the North American electric auto industry. Tesla has grown its reputation on the market through the continuous design of exemplary autos. The sale of cars is made through its network of retailers around North America. For the whole year 2019, Tesla reported gross revenues of $24.57 billion. As of April 2020, the company had a market capitalization worth $88 (Mehta, & Bhavani, 2018). Despite the high demand for its electric vehicles, and the rapid expansion. This is because most of the company revenues go to infrastructure evident the construction of the Gigafactory in Nevada.
At the home market, Tesla has a large number of competitors, and amongst the many in North America, Ford and Honda are currently the most formidable. The home market has quite intense competition, but Tesla has differentiated itself through the manufacture of high-end and self-driving autos. Tesla also seeks to distinguish itself from the contenders through the design and manufacture of EV sport autos. Tesla is also involved in providing a series of automotive services such as design. As such, the company sells the battery technology, which it is the most significant designer and seller currently. Even when Tesla has strived to differentiate itself from other automakers, the traditional car manufactures also seek to increase its offering of hybrid and pure electric vehicles. In North America, brands such as Nissan Leaf offer customers a more affordable option of electric cars (Gautam, Verma, & Srivastava, 2019). However, Tesla has distinguished itself from the competition through exemplary design and next-level performance.
Existing internationalization strategy
Tesla Inc. was formerly known as Tesla motors due to its specialization in the manufacture of electric motors. The automaker is based in Palo Alto, California. The business model of Tesla involves the design and manufacture of electric vehicles, electric car parts, and the electric vehicle powertrain. Although Martin Eberhard cofounded tesla, the company is managed by the CEO, Elon musk owning 22.25% of the company as of 2017 (Lu, 2020, January). Tesla has a growing number of customers who enthusiastically support through marketing and purchase of its products and services. However, customers might perceive the products of tesla as a bit expensive. The price tag of the company is dominated by the Tesla Model S priced at $76,000. Model X on the other hand is priced at $82,000 (Tesla, 2019). The most affordable model of Tesla goes for $35,000. Most of these vehicles are affordable to most of the middle class people. However, it is critical to note that Tesla currently exhibits a higher risk when it comes to the pricing of its goods and services.